Singapore: It will take months for jet fuel supplies and prices to normalise even with the Strait of Hormuz open, the head of the International Air Transport Association warned on Wednesday.

IATA director general Willie Walsh said the disruption to Middle East refining capacity means recovery "is not going to happen quickly" and will take months, not weeks. His comments came even as oil prices plunged after the US and Iran agreed to a two-week ceasefire that includes temporarily reopening the Strait of Hormuz.

"Even if you have the flow of crude start again, if you've had disruptions in refining capacity, then the problem continues for some time," Walsh said. He noted that the aviation industry will likely respond to higher oil prices by raising ticket prices.

While some air traffic has shifted to airlines outside the region, Walsh said Gulf hubs will recover quickly. "There's no way they can replace the capacity that was provided by the Gulf carriers," he added.

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